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Offboarding Employee Checklist & Offboarding Process
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HR + Payroll Software

Offboarding Employees: A Checklist to Make Your Life Easier

One Minute Takeaway

  • Offboarding is a vital step in an employee lifecycle.
  • There are 3 key tasks in offboarding: Formal Steps, Material Transfer and Knowledge Transfer.
  • An exit interview allows you to collect honest feedback that can help in employee retention.

People leave companies for a variety of reasons. For those who leave voluntarily, a smooth employee offboarding process is just as important as a solid employee onboarding process. While the term “offboarding” might not be heard as frequently, your offboarding process is a vital component to your company’s growth and success. As such it needs to be defined and consistently applied across every employee when they leave the company.

Keep reading to see how you can implement an employee offboarding process or improve your existing offboarding program.

What Is the Employee Offboarding Process?

The offboarding process is really one of transition and security. You’re transitioning one employee out of their role and another into that position. A successful transition is where the security component comes in. You’re securing all of the materials that the outgoing employee had access to, you’re securing their final experience with the company  as a positive one and you’re securing the success of the company by making sure there are no gaps regarding customer relationships or internal responsibilities.

This all can be managed through a structured offboarding plan.

Why do We Need an Offboarding Process?

A well-documented employee offboarding process can help ensure compliance with various employment laws, protect your material goods (by collecting the company-issued laptop, building keys and any other company asset) and gathering the knowledge around client relationships and institutional processes that could cause business harm if they were “lost.”

Additionally, when your rock star employees depart on good terms, having a positive offboarding experience can help turn them into so-called “Boomerang Employees” who come back to the company in the future. In fact, a recent study found that 15% of employees have returned to a company they once worked for.

Additionally, a good offboarding program can help with attracting top talent when your superstars recommend the company to their networks because they had an overall high-quality work experience from start to finish.

Offboarding for All

Some companies have a two-tiered offboarding process. Higher level, or more customer-facing, employees may undergo a more detailed offboarding process while others may take part in a much more limited one.

This only shows that a company doesn’t completely understand the value that current employees present to the organization. While an employee may not be “The Face” of the company, they still have a vital role to play in its success and that role should be explored and captured before they are gone.

Why is the Offboarding Process Important?

An offboarding process is about more than just making sure you get the keys back and you know where to send an employee’s final paycheck. It’s about cultivating success in three key business-centric areas.

  • Information
    What does the outgoing employee know about anything and everything? If they were customer facing, what can they tell about those relationships? If they had an internal role, what process shortcuts did they develop? Where were they placing certain files? Ask questions. Ask for documentation.
  • Materials
    Laptops, hotspots, corporate credit cards, office keys—those are the obvious items you need to make sure an employee returns. It’s also important to retrieve any pieces of intellectual property that they may have hard copies of.
    In addition do they have any swag that they used for presentations or cold calls that should be returned? Are there brochures or other marketing materials?
  • Perception
    Is a final impression as important as a first one? Maybe. Treating the offboarding process with respect and professionalism will give the outgoing employee a great final impression of the company. They’ll share this with others in the field. They may even recommend the business as a good place to work (maybe even returning themselves).

    As a bonus it shows the employees who are still there that you do truly care for their long-term career success.

How Do You Conduct Offboarding?

There are three categories of offboarding tasks that need to be managed for every employee.

The Formal Steps

  • Get the employee’s formal letter of resignation. sSave a copy in their personnel file.
  • Provide the employee with a written acceptance of their resignation letter. Save a copy  in their file as well.
  • Enter the employee termination information into your HR database.
    Notify payroll to process any outstanding employee expense reimbursements.
  • Schedule a meeting with the HR team for out-processing. This exit interview should be thorough so consider giving the employee a list of questions/topics beforehand. No matter how strong of an employee that they were there must have been some things they were unhappy about. Their honest feedback should be encouraged as uncovering problem areas will help the company long-term and may help you hold on to other employees.
  • Review non-compete and non-disclosure agreements (NDA).
  • Take the employee off the schedule and remove them from any recurring meetings.
  • Remove the employee from the active employee database.
  • Update your org chart.
  • If the employee has a presence on the customer-facing company website, ask IT to remove them.

The Material Transfer

  • Collect their I.D. badge, keys, computer equipment, company-provided phone, VPN tokens, company credit card, uniforms.
  • Give the employee any relevant benefits documents (COBRA, 401(k) paperwork, etc.).
  • When appropriate, revoke access to the email system, intranet and any shared drives and files.
  • Confirm that the employee doesn’t owe reimbursement for signing or retention bonuses.
  • Determine if the employee has any accrued leave they haven’t taken.

The Knowledge Transfer

You can argue that this is the most important offboarding task. When you’re losing an employee, there is a dangerous possibility of losing a lot of knowledge too. Process information, customer relationship details, project background—it’s all there getting ready to walk out the door. Having a formal plan in place helps the company hold on to that key business detail.

  • Communicate the employee’s departure in an email to anyone affected as soon as possible (e.g., fellow team members, stakeholders, clients or customers, etc.).
  • Conduct a knowledge transfer. Document all details of the employee’s processes and procedures and gather all necessary files to ensure a smooth transition.
  • Provide the employee with their own offboarding checklist. This prompts them to be sure they are providing answers to questions you might not have thought to ask.

Sample Employee Offboarding Checklist

  • Settle any petty cash advances or other expense accounts.
  • Ensure all important files and records are labeled and organized for your successor.
  • Remove personal items from the office, employee lockers, etc.
  • Return keys, keycards, company credit cards, parking permits, etc.
  • Turn in any company-issued mobile devices and computer hardware.
  • Provide your forwarding address so any mail can be forwarded.

Review Non-Compete and Non-Disclosure Agreements (NDAs)

These forms are often used so that confidential company information—such as proprietary software and processes or customer lists—is retained within the company and not shared with your competition. If your employee signed a non-compete, non-disclosure, non-poaching or confidentiality agreement when they were hired, review the terms and conditions of the agreements with them before they leave. Be sure to address any penalties that will apply if an agreement is breached.

Conduct an Employee Exit Interview

Exit interviews are a very important part of the offboarding process. They provide important insight into your business culture, processes, ethics and employee morale. By giving departing employees the opportunity to discuss their observations and reasons for leaving, HR can monitor these responses and determine trends and patterns over time. For example, if you have an employee retention problem in certain departments, maybe it’s time to take a look at the manager.

Sample Exit Interview Questions

  • How did the job compare to your expectations when you started working here?
  • Did you have all of the tools and resources to effectively do your job?
  • Would you recommend our company to people in your network? Why or why not?
  • Is there anything we could have done to persuade you to stay?
  • How did you get along with your manager?
  • What’s the biggest area we can focus on to improve?

If the working relationship wasn’t the best, an employee’s manager can often be a source of conflict. It’s usually best to have someone not close to the situation, such as an HR manager perform the exit interview to make the employee feel more at ease.

What Not to do When Offboarding Employees

The two biggest mistakes a company can make when offboarding an employee are:

  1. “Ignore” the resignation.
  2. Leave everything in the hands of the employee.

Ignoring it happens when you accept the resignation but then let business continue as normal until a few days before their last time in the office. At this point you’re trying to rush a process, hoping that current employees who should connect regarding a transition still can.

The other issue is when you leave it all with the outgoing employee. Yes they have some responsibility in the transition but they’ve already got one foot out the door. Even if they were a strong employee they are probably more concerned with onboarding at their new employer than offboarding at their current one.

These mistakes can cause drops in the information transfer, leave material items uncollected, and lead to bumps in customer relationships. Plus it’s going to give the departing employee a poor last impression of the company. And as you know, negative reviews travel fast.

Tired of All the Paper? Paycor Can Help!

Automating your offboarding program can help ensure you don’t miss critical steps in closing out your working relationship. To learn more, talk to a Paycor representative.